Management-Of-Technology Copyright 2001 Alex Coman The ARENA Genome: Harmonic Strategic Planning

Refinement Stages: Arena, Focus, Action Create Strategy Corporate Layer: Portfolio Businesses Maximize Value Business Layer: Positioning Products by Market Strategy

Arena Layers: Corporate, Business FunctionDefine Hierarchy Function Layer: Process, Project and Product Agile value drive

Business ACTION

Dynamic Vectors: Change, Vision, Scenario. Leader Navigates

Prof. Jacob A. Frankel, Chairman of Sovereign Advisory Group and Global Financial Institutions Group, Merrill Lynch: JIT inventory management will help quick recovery. Alex@coman.org Tel:(972)3-510-1768 -1- Fax:(972)3-516-8960 www.coman.org ARENA

Management-Of-Technology Copyright 2001 Alex Business Action: Skimming (Type I disruptive Coman Focus: Returning R&D investment, Innovation) Constrained production capacity, Limited demand
PC Processors Matsushita VHS $ Cyrix K6 Celeron 486 D P III $ VCRs D Sony Beta Cellcom Cell Phone $ D Orange

Chasm

Athlon P IV $819->$352 Power PC Diversification, Cow Cannibalization Adoption Rate Utility Capacity Learning Curve Moors Law Gillette Costs-4%/Y /Time Quantity

Beeper Niche Products Satellite Iridium` Pelephone Advantage

Ampex $50K Skim Niche Distributors Mass Market Hedged Skimming: Tang, RDC, Velcro

Cost

Follower IBM Leader Effect Hong Kong Effect /Time Quantity

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Cost

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ARENA

Management-Of-Technology Copyright 2001 Alex Coman Business Action: Focus: Maximizing revenues during patent duration; Rigid demand Storming
Storming Pharmaceutical $ 2. Generic D Divide Storming Storming $ D $ D 2.Follower: IBM effect 3. Open Architecture Sensor Mach3 Me Too:No Name Outsourcing Excel +35% 1. Hong Kong Effect Compaq (+60%) Ethical Devoted Follower Viagra Atra Prozak 1.Leader: Apple Closed Architecture Self sufficient Motorola Patent 1st 50% 2nd 50% Time Mac OS Apple Apple SW Computer Peripherals Apple Distributors Education Digital HP MS, Lotus IBM DOS/SW Computer Peripherals IBM++ Compaq Dealers IBM Cluster Business Intel

Price

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ARENA

Business Action: Focus: Market share leadership (Eyeballs, Hits); Lock-in+Oligopoly+Value added Flooding
Flooding $ Ford Levittown Diners Zara IKEA McDonalds D Sony: $279+ Dumping RealNetworks Nintendo: Dolphin $ D IBM+3D by ArtX MS Xbox $299.99 ($125) Launch: 800K games, 1.5M@2001 $500M marketing budget Hybrid Car Dumping $ D Sony 1. Client 2. Navigator Explorer NT Leveraged Dumping $ D 1. Server Navigator Acrobat

Management-Of-Technology Coman

Copyright 2001 Alex

Economies of Scale Utility/User Total Cost Users

2.Toyota Honda

1. Network Externalities I B M W Alex@coman.org Tel:(972)3-510-1768 -4- Fax:(972)3-516-8960 hi

Bob Metcalfs

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ARENA

Management-Of-Technology Coman

Copyright 2001 Alex

Market Web surfing in US, 50% of time: consolidation

Oil Foreign Crisis 1/3

1918 Model T

March 1999, 50B Mins: 11 sites (60%=110) March 2001, 73B Mins: 4 sites (60%= 14) 32% America Online Time Warner 7.5% Microsoft 7.2% Yahoo 3.6% Napster

Competitors

10 0 80

Disk drive Market

60

40
1980 1982 1984 1986 1988 1990 1991
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20
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Management-Of-Technology Coman

Copyright 2001 Alex

Low Cost Positive Loop

Differentiation Low Cost Market Demand: 3 Price Elasticity

Price 2

Cost/unit

Production Function: Economies of Scale 5

1:Skimming Dumping Quantity Sold 4

Quantity Manufactured

Alex@coman.org Tel:(972)3-510-1768 -6- Fax:(972)3-516-8960

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ARENA

Management-Of-Technology Copyright 2001 Alex Coman Business Action: Piercing / Guerilla (Type II disruptive Focus: Penetrating through niche, transforming non-entity into recognized brand Innovation) S.E. Asian Guerilla Linux Guerilla $ D 2.Red Hat $ D

1.Shareware Copy Left: Gnu, Ada

Dependable-Quality Earth-Moving-Equipment Strong service and Support Worldwide Availability Strong, Loyal Full Line of Dealer Network Quality Products High Retail Margins R&D Investment Low Dividends Local Assembly High Plant Investment Low Debt High Margins Low Cost Global Premium Volume Price

Alex@coman.org Tel:(972)3-510-1768 -7- Fax:(972)3-516-8960

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ARENA

Management-Of-Technology Copyright 2001 Alex Coman Business Action: Komatsus strategic Roll-out Skinning the

Maru-C: Encircle Caterpillar Cat world earth-moving equipment vs.16%) Protect home market against Caterpillar (81:50% Licensing deals with: Cummins Engine, International Harvester. Acquire technology and establish benchmarks. Project Ace: Advance quality of small and medium-sized bulldozers above Caterpillars Quality Circles companywide to provide training for all employees Reduce cost while maintaining quality Cost Down Total Cost Down Make Komatsu an international enterprise and build export markets Develop Eastern bloc countries Komatsu Europe marketing subsidiary established Komatsu America established Project B to improve durability and reliability and reduce cost of large bulldozers Project C to improve payloaders Project D to improve Hydraulic excavators Establish presale and service department to assist construction projects in newly industrializing countries Respond to external shocks that threaten markets V-10 program to reduce costs by 10%; reduce parts by 20%. 180 program to budget companywide for 180/$ when exchange rate was 240/$ Response to Oil Crisis: Project E establish teams to redouble cost and quality efforts. Create new products and markets Accelerate product development to expand line. Future and Frontiers program to identify new businesses based on societys needs and company know-how. EPOCHS: reconcile greater product variety with improved production efficiencies. Alex@coman.org Tel:(972)3-510-1768 -8- Fax:(972)3-516-8960 www.coman.org ARENA (84:Caterpillar=43% world earth-moving equipment vs.Komatsu=25%)

Management-Of-Technology Coman

Copyright 2001 Alex

Business Action

How Has Compaq Stayed on Top of the Server Industry?, HBR

ProLiant 1000 ProLiant 1000 ProSignia Rack Mountable

High Relative Level Low

SystemPro

1989
Price Performance File and Print Compatibility Application Compatibility Expandability

1990

1991

1992

1993

Tim 1994 e
Security Servicability Storability

Alex@coman.org Tel:(972)3-510-1768 -9- Fax:(972)3-516-8960

Manageability Configurability Reliability Price Performance File and Print Compatibility Application Compatibility Expandability

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ARENA

Management-Of-Technology Copyright 2001 Alex Coman Business Action: Strategic US Office of Patents commissioner: Everything Gridthat can be invented has been invented, 1899 recommendation that his office be abolished. Present High Strategic Impact of Technology Low Factory
ATM, Airline

Strategic
Bank

Support
Restaurant, Municipality, Hospital

Turnover
Bookstore, Insurance, Broker

Strategic Grid

Low

High

Future Strategic Impact of Technology

Di s a

Tu rn o

Support

Time
Alex@coman.org Tel:(972)3-510-1768 -10- Fax:(972)3-516-8960 www.coman.org

Gre a

Window of Opportunity

Strategic Fa ct or y

ve r

xpe

ct a

wer o P l ea

tion tE

Importance

Importance

ppo

intm ent

Time
ARENA

Management-Of-Technology Coman

Copyright 2001 Alex

6th Generation MSM 50% Smaller; 300Hrs Sand by Mixed signal; USB data interface MSM3100 MSM5000 2x voice capacity Faster data rates<153.6kbps

Qualcomm 1999 annual Report p. 23 Mobile-Station-Modem Phone Chipsets

Features

iMSM Family High Data Rate technology<2.4Mbps Internet; support3rd party OS/Apps 5th Generation MSM 200 hours standby Faster data rates<86kbps IS-95A/95B Compliant MSM3000 4th Generation MSM Highly cost effective MSM2300 3rd Generation MSM Used in QCP800 phone MSM2 2nd Generation MSM Chipset Developed MSM1

1st Generation MSM R&D begins

90

91

92

93

94

95

96

97

98

Time/ 99 Release
ARENA

Alex@coman.org Tel:(972)3-510-1768 -11- Fax:(972)3-516-8960 www.coman.org

Management-Of-Technology Coman Features/ Function Points

Copyright 2001 Alex

Wave PLM

NT: Most Demanding Tasks User/Info Dir, Intelli-mirror NT4.0: Large Data Proc. Windows CE 1997 update: Cluster 1.6M copies NT3.51: Web Server No need for special SW NT3.5: Faster, Stable 2000: Premium, SOHO Professional, 93 NT3.1: 32 bit 29K copies Small Business 98: HTML editor 95: TCP/IP

Apr 92: Win 3.1: Screensaver, TrueType

Mar 93:MS-DOS 6 5 Disk Backup & Compression 4.1 88: DOS 4

92

93

94

95

96

97

98

99

00 Time/Release

Alex@coman.org Tel:(972)3-510-1768 -12- Fax:(972)3-516-8960 www.coman.org

ARENA

Management-Of-Technology Copyright 2001 Alex Coman Business Action: Float-glass process substitution

W.Europe

Alex@coman.org Tel:(972)3-510-1768 -13- Fax:(972)3-516-8960 www.coman.org

ARENA

Management-Of-Technology Copyright 2001 Alex Coman Business Action: Supply/Demand Chasm Typical Time Horizons by Industry, Mid-to-Late 1980s 20

Development Cycle (years)

Transportation Systems Communications Systems

16
&Forestry, Oil Gas Reserves Pharmaceuticals

12

Military Weapons

Biotechnology ,Chemicals Mining 8 Paper Photographic Metal Products Automobile Medical&Dental Lodging 4 Computers Hotels Electronics &Fashion Publishing Foods Software Textiles Silicon Retailing&EntertainmentTobacco Foundries 00 8 16 4 12 20 Financial Approximate Life Cycle of Products (years) -Services
Alex@coman.org Tel:(972)3-510-1768 -14- Fax:(972)3-516-8960 www.coman.org ARENA